The Olympics draws in up to tens of millions of viewers a night. Those viewers have to come from somewhere, and Netflix is worried it might feel a pinch.
During a call with analysts following its Q2 earnings report last month, Netflix was asked how it was factoring the Olympics into its guidance.
"So with an assumption of a hit from the Olympics which largely affects us in the past on gross adds, or on new subscribers coming in, that's going to affect in terms of a year-over-year trend," said David Wells, Netflix's chief financial officer. "We expect that to be a meaningful — a small but still meaningful — impact on the quarter. Negative impact."
Netflix did not respond to repeated requests for clarification on its comments.
Paul Verna, senior analyst at eMarketer, said Netflix is correct in assuming there will be less usage of its service during the Rio Games. He said other services, including streaming video companies and traditional TV networks, also experience that effect.
"Live TV in this particular incarnation, which is a mega sports event, is still the one domain of linear TV that seems to thrive," he said.
That doesn't mean that everyone is tuning into the Olympics on TV, Verna said.